Here are some of the most common tax phrases and terms as well as definitions:

Tax Lien: Instrument or document usually filed at the County Recorder's Office where a person's real property or business is located. The purpose of the filing of a tax lien is to secure the government's interest in that asset. The lien attaches to "all" present and future assets.

Bank Levy: This document freezes all funds in your bank account the day the bank receives the levy. In the case of an I. R. S. levy, the funds are frozen for 21 days which allows you to be notified by the bank and to attempt to have it released before the funds are remitted to the I.R.S. You may deposit and withdraw funds from this account "after" the levy is received which are not subject to the levy.

Wage levy: This is also known as a "garnishment" or "earnings withholding order" and literally attaches to your wages. This levy immediately attaches to any wages owed to you.

Penalty Abatements: The Internal Revenue Code allows for abatement of any penalties associated with the late filing of a return, late payment of tax and late deposit of tax. However, compelling circumstances must exist that meet the "reasonable cause criteria" as defined in the Code. Generally, interest is never abated but for rare occasions.

Offer In Compromise: This is a process that allows for less than full payment of one's liabilities but serves the same purpose. Once an "OIC" is accepted all tax liens are released as if full payment was made. There are 3 types of Offers In Compromise:

1. Doubt as to Collectibility
2. Doubt as to liability
3. Effective Tax Administration
4. A doubt as to collectibility offer is based on an inability to pay and an inability to collect. A doubt as to liability offer is based on the "correctness" of the assessed tax. One must prove that they do not owe the tax. An effective tax administration offer provides for relief based on "equity" of the tax system. In other words, the validity of the tax is not disputed nor is the collection and payment in full at issue. There must be a very compelling reason for an "ETA" offer and very few are accepted.

Installment Agreement: A process where scheduled monthly payments are made to satisfy outstanding taxes. A financial statement must be completed to determine payment amount unless the statutory balance is under $25,000 and/or below $10,000. These installment agreements are referred to as "streamlined" and "guaranteed" and have other criteria/conditions. These are just a few samples of tax "lingo" that you will encounter if you have an "unwanted" relationship with the I.R.S. or other State Tax Agency. In addition, there are numerous levels of bureaucracy you might have to deal with which can make it frustrating to say the least. This is where I can help. My previous experience as a Revenue Officer with the I.R.S. cannot be replaced or substituted by any other experience. I know the collection process from beginning to end. Let me resolve your tax problems so that you can get on with life.

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